This is a true story from my Mentor Matt Lloyd founder of Mobe. This is so true! I was a former student loan debt counselor, so I truly can attest to this!
Yesterday while paying for some snacks at a store here at the Hilton Fiji, I noticed this book on sale:
So I bought a copy, then started flicking through. It’s actually a decent book. In the first chapter, the author talks about the value of getting an MBA, and how overall he thinks its both a waste of time and money.
So I thought I’d share my take on this with you today; do you need to have a degree or MBA to do well in your own business?
And should you encourage your kids, or grand kids, to go to university if they want to start a business?
My answer is, ‘it depends,’ with a strong lean towards ‘No.’ If you want to do well with your own business, a degree or MBA counts for virtually nothing.
Let me explain…
I spent close to 4 years at university. It wasn’t an Ivy league school or anything like that, but, is considered one of the top universities in Australia, and definitely the top one in my home city of Perth.
My initial degrees were going to be Philosophy and Psychology.
Then after a year I changed to business and psychology.
Then after another year, I changed to business and economics.
In my fourth year I got into the world of internet marketing, and decided it was time to start my own business.
I had 2 options;
1.) Work on my business part time, a few hours a day, and finish my degrees so I’d have something to ‘fall back on’ if my online business didn’t work out.
2.) Quit university, get no degrees or anything to show for the past 4 years, but I could at least focus full time on building my business and become successful much faster.
Patience is something i have a very short supply of, so I chose option 2.
All I left with was a $25,000 student bill.
Of course, my parents were not thrilled. They said, “at least finish your studies so you have something to fall back on if the online business thing does not work out.”
I knew that was flawed thinking though. If I approached my business with that mentality, I was doomed the fail from the start. I had to be ‘all-in’ or nothing for it to work.
But boy, did I start learning fast.
In those first 24 months of being in the trenches, I learned far more than I had in the previous 4 years of university.
Very little of what I learned at university has helped me succeed in the business world.
If I could go back in time to 2009, instead of going to business school I’d go buy a bunch of great business books and study them instead, and then immediately begin building my business.
Nothing will ever take the place of real-world experience, and learning lessons through making a lot of mistakes.
To spend 3 or 4 years of your life at university carries an enormous opportunity cost with it for real-world learning.
Now, does this mean that I’m totally against going to business school and getting a degree if you plan to be a business owner?
No, not completely. There are some useful topics you can learn. For example, accounting. I WISH I paid more attention during those Accounting 101 units. Those are useful skills I really could have used in my business. Finance 101 also has it’s uses. Understanding how an asset gets valued from future cash flow streams has its uses, for when you’re deciding which internal projects you should invest in next.
But as far as topics like marketing, and HR, and entrepreneurship – those are topics best learned through experience and a few select books.
Side note: I think it’s a joke when university’s have classes and majors in ‘entrepreneurship’ being taught by professors who’ve never built successful business’s. No matter how many biographies and textbooks you read about successful entrepreneurs, you have no right to teach the topic unless you’ve started and scaled a business of your own.
My other big problem with business degrees, is the intent in which students undertake their studies.
Most students study to pass exams and get good grades. Surface-level understanding.
They don’t study with the primary intention of deep-level understanding, and real world application.
I can’t tell you how many times during my studies I pulled all-nighters, cramming in as many facts and figures into my tired brain for the next mornings exam.
Somehow I’d always get through – occasionally I’d even get good marks.
But 7 days later, I’d have forgotten 90% of what I’d learned. The knowledge had not sunk in at a deep level.
In the real business world, no one cares about an exam grade.
None of my customers have ever asked to see my degree.
No traffic vendors have ever requested to see my grades.
No super affiliates who promoted my brand and made millions for the both of us wanted to know which university I graduated from.
At the end of the day, the only think that counts in the real world, is you figuring out the answers for yourself and getting results.
The only thing that gets rewarded is knowledge applied in the right areas.
So if you (or someone you know) is dead set on going to university to study business and I can’t talk you / them out of it, my advice is simple: study for deep level understanding and for real world application. The exams themselves are less important in the real world than you think.
My final disclaimer here:
All my advice above is for people who want to be real entrepreneurs.
I’m not talking about the ‘entrepreneur on instagram and Facebook’ type (you know the ones, posting about how great their lifestyle is, when the reality is they don’t have a pot to piss in).
I’m talking about those who cannot be talked out of the idea of starting their own business – those who don’t believe in concept of weekends – those who have an obsession with building a massively successful company.
For these people, they just don’t need to go to business university.
That’s my rant for today. If you want to hear me elaborate a little more on my views, here’s a short video of a university student asking me about dropping out of school: